Only 5% of Enterprises Ready for Virtualization Overhaul as 67% Plan Major AI-Driven Shift

More than two-thirds of global enterprises are planning significant changes to their virtualization strategies within the next two years, yet only 5% say they are fully prepared to execute those changes, according to a new survey by Hewlett Packard Enterprise (HPE).

The study, which surveyed nearly 400 organizations worldwide, highlights mounting pressure on IT leaders as artificial intelligence workloads increase operational complexity and cloud costs. Enterprises are rethinking whether their infrastructure can keep pace with AI performance demands while maintaining cost predictability.

While licensing changes have disrupted the virtualization landscape, the shift is not being driven primarily by pricing concerns. Just 4% of respondents identified licensing costs as the main catalyst for change. Instead, organizations are prioritizing hybrid operating models and AI readiness.

Budget constraints (28%), technical complexity (24%), migration risks (21%) and skills shortages (20%) emerged as the top barriers slowing what HPE describes as a broad virtualization reset.

Rather than replacing platforms outright, many enterprises are opting for phased modernization. About 57% of respondents said they are taking a gradual approach to future-proof IT environments, with hybrid cloud emerging as the preferred architecture for supporting AI workloads.

Deployment patterns already reflect diversified infrastructure footprints: 78% of organizations provision workloads in public cloud environments, 61% in virtualized clusters, 48% in private clouds and 32% at the edge.

AI preparedness is becoming a central decision factor. More than a quarter of IT leaders ranked AI readiness as a top priority when shaping future virtualization strategies. Enterprises identified unified backup and cyber-recovery (70%), cross-platform governance (61%) and integrated observability and AIOps (55%) as critical capabilities.

Brian Gruttadauria, CTO of Hybrid Cloud at HPE, said enterprises are reassessing long-standing IT assumptions to balance cost control with AI performance requirements. He noted that AI ambition increasingly depends on how effectively virtualization platforms evolve to handle new workload demands.

The findings point to a structural inflection point in enterprise IT. Virtualization, once primarily a cost-efficiency tool, is now emerging as a strategic foundation for AI-era infrastructure transformation.